The FTT is gathering pace, but we can't rest on our laurels

There’s a buzz in the air as the ongoing battle to win support for a Financial Transaction Tax (FTT) gathers pace. Over the course of the past 18 months, the FTT has shifted from a radical idea to a realistic proposition considered by the International Monetary Fund, the European Commission and Parliament, the G20 and several national governments.

That’s no mean feat, and civil society organisations – including Action for Global Health – can take a lot of credit for keeping the pressure on our leaders, through intensive campaigning and advocacy work.

Later this week, on 22 June 2011, NGOs and trade unions around the world will join forces once more to call for a fairer financial system. Ahead of the European Council on 23-24 June, this is our chance to demonstrate the strength, breadth and diversity of support for the international Financial Transaction Tax. Our governments need to know that we are watching them, and that we expect them to deliver. It’s a big day for a tiny tax which has a huge potential to improve people’s lives all over the world.

There’s widespread belief that the FTT has come of age – academics, economists and NGOs alike seem to be falling over themselves promoting its benefits. And politicians are increasingly sitting up and taking notice. The European Parliament has repeatedly called for the implementation of an FTT, be it at global or EU-only level. At national level, French president Nicolas Sarkozy, who currently chairs the G20, and German Chancellor Angela Merkel have long been considered leading supporters.

The campaign received an enormous boost last week when the French parliament voted in favour of a resolution supporting an FTT in Europe, be it at EU, Eurozone or coalition of willing countries. Hot on its heels, the Brazilian parliament also passed a resolution calling for the government to support the adoption of an FTT. They say good news comes in threes, so what’s next?

Things are moving, but we can’t afford to rest on our laurels – we are currently facing an estimated funding shortfall of almost €350bn from 2009-2015 for global health, and the revenue an FTT is capable of generating could go a long way to closing this gap. And therein lies the rub…

While NGOs have been vocal in demanding that the revenue generated by an FTT goes towards development and climate change, the French resolution pinpoints the national budget as the primary destination for this much-needed money. The latest resolution by the European parliament similarly identifies an FTT as a means of partially financing EU budget and lowering member states GNI contributions. This shift is worrying.

The European Commission, meanwhile, remains ominously silent as we await its impact assessment on the merits of both the FTT and the Financial Activities Tax. It’s no secret that taxation commissioner Algirdas Šemeta is hardly the FTT’s biggest fan, but he has promised an unprejudiced and neutral assessment, expected to be released in the coming months, which we await with baited breath.

We’re at a critical juncture for the FTT, in more ways than one. We could be on the cusp of a momentous achievement, and we must focus our efforts to ensure this becomes a reality, not for our sake, but for the sake of those most in need all over the world.

Anton Kerr is National Convenor of Action for Global Health (UK) and Head of Policy at the International HIV/AIDS Alliance.